From the Magna Carta to the U.S. Constitution, written documents have helped shape the way people live and interact with one another for centuries. The fundamental documents that establish co-ops and condos have that same importance in building a well-oiled, well-functioning community albeit on a smaller scale, of course. That is why it is so important to ensure that these materials are up-to-date, accurate and fully reflect the co-op, condo and people who live within it.
Before the first beams are raised or the first unit converted, co-ops and condos need some basic documents drawn up and in place for the community to become a reality. For condominiums, those fundamental documents include the master deed and bylaws, says attorney J. David Ramsey, a shareholder with the law firm of Becker & Poliakoff in Morristown.
For homeowner’s associations, those documents include a certificate of incorporation and a declaration instead of a master deed. For co-ops, “there is no master deed or declaration,” Ramsey says. “There is a proprietary lease and bylaws. Co-ops own the building and you, as shareholder, buy shares that entitle you to lease a certain apartment in the building. The proprietary lease can be similar in content to the master deed, explaining your share of maintenance fees et cetera.”
And who draws up these documents? “The developer or sponsor for the condominium,” says Ramsey.
“And attorneys like me,” says Wendell Smith, a partner in the real estate department of the law firm of Greenbaum Rowe Smith & Davis LLP in the Woodbridge office. The entities are established as non-profit organization for condominiums and homeowner’s associations, he says. Co-ops might be one or the other—non-profit or for-profit. Smith is a co-author of the law book New Jersey Condominium and Community Association Law.